Victory for Donald Trump in the US Presidential election may effect China’s economy in a major way.
The candidate’s promise to slap punitive tariffs on Chinese imports would be highly contractionary, deflationary and wipe hundreds of billions off the value of the world’s second-biggest economy, according to new research by Kevin Lai, the Hong Kong-based chief economist for Asia (excluding Japan) at Daiwa Capital Markets.
Lai estimates that Trump’s suggestion of a 45% tariff for Chinese imports would cause an 87% decline in China’s exports to the USA.